BETAS AND DEBT MANAGEMENT WITHIN THE UK TAX ENVIRONMENT

Tax complexities relating to corporate tax losses, induced by debt finance, and to the differential tax treatment of equity and sterling debt, are introduced into corporate valuation. The after personal tax value of the geared firm can be less than that of the equivalent ungeared firm. Also, debt-induced tax losses can create negative betas. These fiscal effects are incorporated into degearing formulae under active and passive debt management policies.     

Employment Opportunities for Consumer Affairs Professionals

This analysis of consumer affairs professionals in business and government describes what functions they perform, where they are employed, what education and experience is required and what their salaries are. Professional educators in the consumer field have generally ignored the career field of consumer affairs professional. Colleges and universities train consumer majors to be educators, researchers, or extension workers, but little attention is paid to the education of consumer affairs professionals for business and government. This article not only attempts to give educators in the consumer field a greater awareness of this relatively new career so that they can develop educational programs more intelligently but also attempts to make business and government more aware of what is being done in this area so they may be able to utilize the talents of consumer affairs professionals.     

Household Finance

The study of household finance is challenging because household behavior is difficult to measure, and households face constraints not captured by textbook models. Evidence on participation, diversification, and mortgage refinancing suggests that many households invest effectively, but a minority make significant mistakes. This minority appears to be poorer and less well educated than the majority of more successful investors. There is some evidence that households understand their own limitations and avoid financial strategies for which they feel unqualified. Some financial products involve a cross‐subsidy from naive to sophisticated households, and this can inhibit welfare‐improving financial innovation.     

Common Divisors,Payout Persistence,and Return Predictability

In the finance and accounting literature, the use of a common divisor in the dependent and independent variables of ordinary least‐squares regressions is commonplace. What goes less recognized, however, is that their use induces spurious correlation between the regression variables and invalidates standard testing procedures. This paper analyses the common divisor problem by outlining analytical results concerning the expected R² and providing a simulation procedure that generates test statistics from which critical values can be drawn. To illustrate the procedure, we re‐investigate payout yield return predictability findings that have appeared in the literature and show that the results are spurious.     

Explaining Financial Management Behavior for Koreans Living in the United States

Using a cross‐cultural conceptualization with a targeted sample of Americans and Koreans, it was noted that Koreans exhibited more responsible financial management behavior than Americans after controlling for locus of control, financial knowledge, and income interactions. Overall, financial knowledge was positively related to responsible financial behavior. No direct effects on financial management behavior were noted for locus of control or household income. Locus of control was found to mediate the effect of financial knowledge on financial behavior for Koreans. Being Korean did moderate between financial knowledge and financial behavior.